Equity loan or consumer proposal?
I am in a lot of debt and have not been paying it off for 3 years. I went to a credit couselling place but fell off track, They awarded me R7 on my rating. I still keep up to date on my mortage payments and have a car that is worth less than $2000, I use for work. Would it be better to get a equity loan if my house is said to be worth $40K and still have $12K owing on it to clear up all of my credit debts. I am working 2 jobs,that averages 75 hours weekly, @11.50 hr. and rent 2 room out of the house for $385 monthly incl. utilities. What can you say here about this?
If you can afford to get a home equity loan and pay off your unsecured debts in full, and continue making your mortgage payments, then yes, that may be a good idea. However, if you need to work two full-time jobs to be able to make ends meet, you may be better off either selling the house (and using the equity to repay your other debts) or filing a consumer proposal to allow you to make more manageable payments each month. I suggest you contact a licensed trustee to review your numbers in detail and help you determine the best course of action. Pay close attention to your monthly budget, because I believe that your ability to make your monthly payments will help yo make the decision.